Vaccine Marketing - Innovation and Marketing in the Pharmaceutical Industry - page 385

different vaccines targeting the same disease, states are free to choose from among
them (Institute of Medicine 2003 ). Some states select a subset among the competing
brands to reduce system complexity and costs, while others leave the choice up to the
health care professionals (“provider choice”), hoping this will raise the willingness
of private practices to provide public vaccines (Freed and Cowan 2002 ).
The UK National Health System (NHS) has a dual system for procuring vaccines
for its universal vaccination programs. Vaccines for the routine childhood program
are procured centrally by the Department of Health and distributed directly to GPs.
Vaccines for the seasonal fl u vaccination program, however, are procured by GPs,
who receive reimbursement for the cost of the vaccine plus a fee for procuring the
vaccine. The NHS is currently considering central procurement of seasonal fl u vac-
cine, a move which it estimates would reduce vaccine costs by 35 % and procure-
ment administration costs by 76 % (Department of Health 2011 ).
The UN's UNICEF Supply Division and the Revolving Fund of the PAHO are
the two most important supranational vaccine procurement agencies. 22 The UNICEF
Supply Division is the major procurer of vaccines for low-income countries, 23 pro-
curing immunization supplies on behalf of around 80-100 countries annually,
reaching 58 % of the world's children. In 2010, UNICEF procured around 2.5 bil-
lion doses of vaccines, at a value of $750 million. 24 UNICEF procures only vaccines
that have been WHO prequalifi ed. 25 To promote vaccine security (the uninterrupted,
sustainable supply of affordable vaccines of assured quality) UNICEF tries when-
ever possible to procure each vaccine from several manufacturers instead of pursu-
ing a “winner takes all” policy (International AIDS Vaccine Initiative, 2008b ).
Countries or donors pay for vaccines upfront by depositing the needed funds with
UNICEF, which provides manufacturers with demand forecast, and enters into mul-
tiyear supply arrangements (International AIDS Vaccine Initiative 2008b ). A recent
change in policy from posting only average prices to posting prices for individual
vaccines 26 from manufacturers having given permission to do so revealed signifi cant
price differences. Some companies disclosed their prices, others refused, but all
agreed not to disclose their cost structures. UNICEF hopes that the increased price
nonfederal funds, particularly funds from insurance companies (Benatar et al. 2010 ). Despite their
smaller purchase volume, some states have reported instances in which they were able to negotiate
a price below the federal contract price (Freed and Cowan 2002 ).
22 The Gulf Cooperation Council (GCC), which procures vaccines for the UAE, Bahrain, Saudi
Arabia, Oman, Qatar, and Kuwait, is another supranational vaccine procurement agency. See
DeRoeck et al. ( 2006 ) for a review of the GCC.
23 Excluding China, India, and Indonesia, 92 % of the 2007 birth cohort in low income and 47 % of
the birth cohort in lower middle income countries were covered by UNICEF procurement. The
percentage of UNICEF procurement in high income OECD countries was 0 %, 2 % in high income
non-OECD countries, and 1 % in lower middle income countries (Rosenbom 2010 ).
24 http://www.unicef.org/supply/index_vaccines.html , accessed August 22, 2011.
25 UNICEF procures for governments, NGOs, UN agencies, international fi nancial institutions,
philanthropic organizations, and universities, but not for profi t-making entities and individuals.
26 http://www.unicef.org/supply/index_57476.html .